Pesticides Make a Comeback
Many Corn Farmers Go Back to Using Chemicals as Mother Nature Outwits Genetically Modified Seeds
By IAN BERRY
Insecticide sales are surging after years of decline, as American farmers plant more corn and a genetic modification designed to protect the crop from pests has started to lose its effectiveness.
The sales are a boon for big pesticide makers, such as American Vanguard Corp. and Syngenta AG. But it has sparked fresh concerns among environmental groups and some scientists that one of the most widely touted benefits of genetically modified crops—that they reduce the need for chemical pest control—is unraveling. At the same time, the resurgence of insecticides could expose both farmers and beneficial insects to potential harm.
Until recently, corn farmers in the U.S. had largely abandoned soil insecticides, thanks mostly to a widely adopted genetic trait developed by Monsanto Co. that causes corn seeds to generate their own pest-killing toxins, but which the Environmental Protection Agency says doesn't hurt humans.
The modified seeds, first introduced in 2003, proved to be largely effective against the corn rootworm, a voracious bug that is the main scourge of the nation's largest crop. Today, according to the U.S. Department of Agriculture, two-thirds of all corn grown in the U.S. includes a rootworm-targeting gene known as Bt.
As more farmers switched to the modified seed, the share of corn acreage treated with insecticide fell to 9% in 2010, the most recent year for which data are available, from 25% in 2005, according to USDA data. Those farmers who continued to use insecticide applied less in 2010, the data showed.
In 2011, however, entomologists at Iowa State University and the University of Illinois started to document rootworms that were immune to the Monsanto gene, and have found these resistant pests scattered across the Midwest. Now, many farmers have decided they need to spray their soil to kill any rootworms that have developed Bt resistance, as well as growing populations of other pests.
Scott Greenlee, who farms 1,700 acres in Sac City, Iowa, said he planned to start using a soil insecticide this year after part of his crop succumbed to rootworms in 2012. The 53-year-old Mr. Greenlee, who had planted Monsanto's Bt corn, said the affected fields produced just 50 or 60 bushels per acre, about a third of his normal yield. "It was a train wreck," he added.
Also driving insecticide use is the rising share of farmland planted to corn, as farmers seek to take advantage of corn prices that are about double their historic norms. U.S. farmers planted 97 million acres of corn last year, the most since the 1930s and up from 75.7 million in 2001.
The government doesn't track insecticide use annually, but U.S.-based American Vanguard and FMC Corp. and Switzerland-based Syngenta, which account for more than three-quarters of the market for soil pesticides, reported significantly higher sales last year and in early 2013.
Syngenta, one of the world's largest pesticide makers, reported that sales of its major soil insecticide for corn, which is applied at planting time, more than doubled in 2012. Chief Financial Officer John Ramsay attributed the growth to "increased grower awareness" of rootworm resistance in the U.S. Insecticide sales in the first quarter climbed 5% to $480 million.
American Vanguard bought a series of insecticide companies and technologies during the past decade, betting that insecticide demand would return as Bt corn started losing its effectiveness. In the past couple of years, that wager has paid off.
The Newport Beach, Calif., company reported that its soil-insecticide revenue jumped 50% in 2012, and company earnings climbed 70% as its stock price doubled. Its insecticide sales rose 41% in the first quarter to $79 million, with gains driven by corn insecticide.
FMC, based in Philadelphia, reported a 9% increase in first-quarter sales in its agricultural business, which includes insecticides and herbicides, following a 20% increase in the fourth quarter. The gains are due in part to concerns about resistance, company officials said.
"The whole industry has seen a resurgence," said Aaron Locker, marketing director for FMC, which has annual revenue of more than $3 billion.
Monsanto, the world's largest seed company by sales, became the first company to sell rootworm-resistant corn to farmers a decade ago and has licensed the Bt gene to other seed makers.
In approving the original Monsanto product, the EPA said reduced insecticide use was one of the "significant benefits." The seed, the EPA said, would "provide the grower and other occupational workers greater safety, protect water bodies from [agricultural] runoff and mitigate" potential harm to birds and other organisms.
Monsanto said it continues to recommend that farmers rotate their fields from corn to other crops, such as soybeans, which "breaks the rootworm cycle." The St. Louis company also said it and other companies are selling seeds with more than one rootworm-resistant trait.
Scientists have confirmed rootworm resistance only to the Monsanto seed that includes just one rootworm trait. Monsanto is phasing out that seed in favor of a multiple-trait version. And Monsanto says it is developing new technology to fight rootworms, which it hopes to put on the market by the end of the decade.
But some scientists say rootworm resistance could be a persistent problem. The EPA has said that rootworms that have developed resistance to Monsanto's first trait are more likely to develop resistance to other rootworm traits as well.
Crop consultants and researchers said the population of pests other than rootworm has increased in many parts of the Midwest because farmers are planting corn every year, and because some stopped using pesticides altogether after adopting Monsanto's Bt corn, even though it isn't designed to kill pests other than rootworms.
"When Bt hybrids were introduced, one upside was a reduction in soil insecticides," said Michael Gray, an entomologist at the University of Illinois. "Some of those gains are quickly being reversed."
Mr. Gray, in surveys this past winter, found that roughly 50% of corn farmers planned to use both the Bt seed and a soil insecticide. He found that about a quarter of them planned to use insecticide as "cheap insurance" against the possibility of pest problem.
Write to Ian Berry at ian.berry@dowjones.com
